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Catabasis Pharmaceuticals Reports Second Quarter 2018 Financial Results and Reviews Business Progress

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-- Edasalonexent Phase 3 PolarisDMD Trial in Duchenne Muscular
Dystrophy Expected to Initiate in the Second Half of 2018 --

Catabasis
Pharmaceuticals, Inc.
(NASDAQ:CATB), a clinical-stage
biopharmaceutical company, today reported financial results for the
second quarter ended June 30, 2018, and reviewed recent business
progress.

"We are thrilled to have achieved important milestones that enable the
Phase 3 PolarisDMD trial of edasalonexent for registration purposes. We
are now completing final preparations and expect to initiate the Phase 3
trial in the coming months," said Jill C. Milne, Ph.D., Chief Executive
Officer of Catabasis. "Based on muscle effects and stabilization of
function seen with edasalonexent treatment in Phase 2, we believe
edasalonexent could fundamentally change the course of Duchenne disease
progression and the treatment paradigm. We look forward to advancing
edasalonexent into the PolarisDMD trial as we progress towards our goal
of making edasalonexent available to all those affected by Duchenne with
the hope of enabling patients to maintain their functional abilities
longer."

Recent and Upcoming Corporate Highlights

  • Announced plans for edasalonexent Phase 3 PolarisDMD trial in Duchenne
    muscular dystrophy (DMD), expected to initiate in the second half of
    2018 with top-line results expected in the second quarter of 2020. The
    trial design was informed by discussions with the U.S. Food and Drug
    Administration (FDA) as well as input from treating physicians and
    families of boys affected by Duchenne.
    • The PolarisDMD trial will evaluate the efficacy and safety of
      edasalonexent in patients with DMD and is intended to support an
      application for commercial registration of edasalonexent.
    • The randomized, double-blind, placebo-controlled PolarisDMD trial
      is expected to enroll approximately 125 patients ages 4 to 7 (up
      to 8th birthday) regardless of mutation type who have
      not been on steroids for at least 6 months. Boys on a stable dose
      of eteplirsen may be eligible to enroll.
    • The primary efficacy endpoint will be change in the North
      Star Ambulatory Assessment score after 12 months of treatment with
      edasalonexent compared to placebo. Key secondary endpoints are
      planned to include the age-appropriate timed function tests time
      to stand, 4-stair climb and 10-meter walk/run. Assessments of
      growth, cardiac and bone health are also planned.
  • Presented new edasalonexent clinical biomarker data demonstrating
    NF-kB target engagement in the MoveDMD trial in boys affected by DMD
    at the New Directions in Biology and Disease of Skeletal Muscle
    Conference in June 2018. NF-kB is a fundamental driver of disease
    progression in DMD.
  • Presented new magnetic resonance imaging (MRI) data through one year
    of edasalonexent treatment at the American Academy of Neurology (AAN)
    70th Annual Meeting in April 2018. Edasalonexent significantly slowed
    DMD disease progression as measured by MRI compared to the
    off-treatment control period.
  • Catabasis closed a $42 million underwritten public offering in June
    2018. The proceeds will be used for the Phase 3 PolarisDMD clinical
    trial of edasalonexent for the treatment of DMD, as well as for
    working capital and general corporate purposes.

Second Quarter 2018 Financial Results

Cash Position: As of June 30, 2018, Catabasis had cash and cash
equivalents of $49.9 million, compared to $17.0 million as of March 31,
2018. Based on the Company's current operating plan, Catabasis believes
it has sufficient cash to fund operations into Q2 2020. Net cash used in
operating activities for the three months ended June 30, 2018 was $5.6
million, compared to $5.7 million for the three months ended June 30,
2017. Net cash used in operating activities for the six months ended
June 30, 2018 was $12.4 million, compared to $13.8 million for the six
months ended June 30, 2017.

R&D Expenses: Research and development expenses were $4.2
million for the three months ended June 30, 2018, compared to $4.5
million for the three months ended June 30, 2017 and $9.5 million for
the six months ended June 30, 2018, compared to $9.9 million for the six
months ended June 30, 2017. The decrease in research and development
expenses was primarily attributable to a decrease in direct program
costs.

G&A Expenses: General and administrative expenses were $2.4
million for the three months ended June 30, 2018 and 2017, respectively,
and $4.8 million for the six months ended June 30, 2018 and 2017,
respectively.

Operating Loss: Loss from operations was $6.6 million for the
three months ended June 30, 2018, compared to $6.9 million for the three
months ended June 30, 2017 and $14.3 million for the six months ended
June 30, 2018, compared to $14.7 million for the six months ended June
30, 2017.

Net Loss: Net loss was $6.5 million, or $0.20 per share, for the
three months ended June 30, 2018, compared to a net loss of $7.0
million, or $0.32 per share, for the three months ended June 30, 2017.
Net loss for the six months ended June 30, 2018 was $14.1 million,
compared to $14.9 million for the six months ended June 30, 2017.

Conference Call and Webcast
Catabasis will host a conference
call and webcast at 8:30am ET today to provide an update on corporate
developments and to discuss second quarter 2018 financial results.

   
Participant Toll-Free Dial-In Number: (877) 388-2733
Participant International Dial-In Number: (541) 797-2984
Pass Code: 5876459
 

Please specify to the operator that you would like to join the
"Catabasis Second Quarter 2018 Results Call."

Interested parties may access a live audio webcast of the conference
call via the investor section of the Catabasis website, www.catabasis.com.
Please connect to the Catabasis website several minutes prior to the
start of the broadcast to ensure adequate time for any software download
that may be necessary. The webcast will be archived for 90 days.

About Edasalonexent (CAT-1004)
Edasalonexent (CAT-1004) is
an investigational oral small molecule that is being developed as a
potential foundational therapy for all patients affected by DMD,
regardless of their underlying mutation. Edasalonexent inhibits NF-kB, a
protein that is activated in DMD and drives inflammation, fibrosis and
muscle degeneration and suppresses muscle regeneration. Edasalonexent
continues to be dosed in an open-label extension of the MoveDMD Phase 2
clinical trial, and Catabasis is preparing to initiate a single global
Phase 3 trial in the second half of 2018 to evaluate the efficacy and
safety of edasalonexent for registration purposes. The FDA has granted
orphan drug, fast track and rare pediatric disease designations and the
European Commission has granted orphan medicinal product designation to
edasalonexent for the treatment of DMD. For a summary of clinical
results reported to-date, please visit www.catabasis.com.

About Catabasis
At Catabasis Pharmaceuticals, our mission is
to bring hope and life-changing therapies to patients and their
families. Our lead program is edasalonexent, an NF-kB inhibitor in
development for the treatment of Duchenne muscular dystrophy. The global
Phase 3 PolarisDMD trial is expected to initiate in the second half of
2018. For more information on edasalonexent and our Phase 3 PolarisDMD
trial, please visit www.catabasis.com.

Forward Looking Statements
Any statements in this press
release about future expectations, plans and prospects for the Company,
including statements about future clinical trial plans including, among
other things, statements about the Company's plans to commence the
global Phase 3 PolarisDMD trial in DMD to evaluate the efficacy and
safety of edasalonexent for registration purposes, and the Company's
expectation that based on its current operating plan it has sufficient
cash to fund operations into the second quarter of 2020 and other
statements containing the words "believes," "anticipates," "plans,"
"expects," "may" and similar expressions, constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Actual results may differ materially from those
indicated by such forward-looking statements as a result of various
important factors, including: uncertainties inherent in the initiation
and completion of preclinical studies and clinical trials and clinical
development of the Company's product candidates; whether interim results
from a clinical trial will be predictive of the final results of the
trial or the results of future trials; expectations for regulatory
approvals to conduct trials or to market products; availability of
funding sufficient for the Company's foreseeable and unforeseeable
operating expenses and capital expenditure requirements; other matters
that could affect the availability or commercial potential of the
Company's product candidates; and general economic and market conditions
and other factors discussed in the "Risk Factors" section of the
Company's Quarterly Report on Form 10-Q for the quarter ended June 30,
2018, which is on file with the Securities and Exchange Commission, and
in other filings that the Company may make with the Securities and
Exchange Commission in the future. In addition, the forward-looking
statements included in this press release represent the Company's views
as of the date of this press release. The Company anticipates that
subsequent events and developments will cause the Company's views to
change. However, while the Company may elect to update these
forward-looking statements at some point in the future, the Company
specifically disclaims any obligation to do so. These forward-looking
statements should not be relied upon as representing the Company's views
as of any date subsequent to the date of this release.

 

Catabasis Pharmaceuticals, Inc.
Condensed Consolidated
Statements of Operations
(In thousands, except share and
per share data)

(Unaudited)

       

Three Months Ended
June 30,

   

Six Months Ended
June 30,

2018     2017 2018     2017
 
Operating expenses:
Research and development 4,239 4,519 9,486 9,917
General and administrative   2,397     2,400     4,789     4,763  
Total operating expenses   6,636     6,919     14,275     14,680  
Loss from operations (6,636 ) (6,919 ) (14,275 ) (14,680 )
Other income (expense):
Interest expense (33 ) (127 ) (90 ) (276 )
Interest and investment income 43 44 75 83
Other income, net   147     28     159     23  
Total other income (expense), net   157     (55 )   144     (170 )
Net loss $ (6,479 ) $ (6,974 ) $ (14,131 ) $ (14,850 )
Net loss per share - basic and diluted $ (0.20 ) $ (0.32 ) $ (0.48 ) $ (0.73 )
Weighted-average common shares outstanding used in net loss per
share - basic and diluted
  32,728,771     21,796,194     29,659,358     20,452,200  
 
       

Catabasis Pharmaceuticals, Inc.
Condensed
Consolidated Balance Sheets

(In thousands)
(Unaudited)

 
June 30, December 31,
2018 2017
Assets
Cash and cash equivalents $ 49,931 $ 16,369
Total assets 50,847 17,897
Liabilities and stockholders' equity
Current portion of notes payable, net of discount 831 2,479
Total liabilities 5,035 6,105
Total stockholders' equity $ 45,812 $ 11,792
 
       

Catabasis Pharmaceuticals, Inc.
Condensed
Consolidated Statements of Cash Flows

(In thousands)
(Unaudited)

 

Six Months Ended June 30,

2018 2017
Net cash used in operating activities $ (12,421 ) $ (13,785 )
Net cash provided by investing activities 8 14,901
Net cash provided by financing activities   45,975     4,657  
Net increase in cash and cash equivalents $ 33,562   $ 5,773  
 

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